Recently Thefuture.fm announced that they were launching a royalty system for DJs that upload mixes to the site. Having already solved the problem of paying copyright holders for mix content, they are now offering DJs a compelling mix of revenue sources that should be much bigger news than most of the music industry and tech media seem to recognize. This week I spoke with Thefuture.fm's new CEO, Bob Barbiere, who filled me in on the specifics.

I began covering Thefuture.fm, the creators of MixSCAN, a technology that identifies rights holders in DJ mixes for royalty purposes, back in 2011 when they were called Dubset. Even then the potential for their MixSCAN technology was clear but it was unclear how the site itself might fare. However, given that they were making it possible for DJs to create legal mixes and avoid potential legal concerns, I knew they could build a business but I wasn't sure how they would make money.

Though a handful of sites covered the news, no one clarified where that money would come from nor on what basis DJs would be paid. Recently appointed CEO Bob Barbiere, formerly the COO, shared specific details of how DJs would get paid and why now is the time to get on the platform.

Key Details for DJs

Currently Thefuture.fm is free for DJs to join and upload mixes. That could change on down the line but there are no immediate plans to charge DJs. However, anyone who signs up now will continue to be able to use the service for free.

DJs can offer both free and premium content. The idea is to make premium content exclusive to subscribers ($7.99 a month) while using free, ad-supported content to introduce the service to new users. However, ads are not the emphasis for generating future revenue.

DJs are paid 50 cents a month for each subscriber they recruit. That might not sound like much until you consider that a major DJ could bring in large numbers of fans and thus create long-term residual income. Subscribers will then have access to all premium content which will help keep them on board.

15% of monthly subscription income goes to a royalty pool for DJs which will be divided each month based on plays. 40% goes to music rights holders. Ad revenue has the same split but is expected to be a much smaller piece of the pie and will also fluctuate due to changes in ad rates.

Live Streaming DJ Sets Coming Later This Year

Barbiere also revealed another revenue component, broadcasts of live shows, that should roll out later this year. The idea is that DJs who have broadcast quality internet connections or are in venues with such capabilities will be able to stream live audio from shows that will be available to subscribers. This opens the possibility for pay-to-play events.

As a DJ adds more live shows to their premium content, older shows can then be moved to free status. That will allow DJs to focus on creating premium content while still providing quality free content. Barbiere said they already have at least 100 artists lined up to take advantage of this opportunity.

In addition, if live streamed video is available, that could eventually be added to the mix but Thefuture.fm plans to stick to high quality audio. Though we didn't discuss the possibility, clearly there's an opportunity here for live streaming services to partner with Thefuture.fm.

Discounted Subscriptions Currently Available via Indiegogo

Currently Thefuture.fm is using crowdfunding platform Indiegogo to offer highly discounted subscriptions as well as some higher priced special events. Barbiere admitted that it's been a huge learning experience and that they basically jumped into it after being approached by multiple crowdfunding platforms. With almost 4 weeks left, they are now focusing on encouraging DJs to get fans to sign up via Indiegogo but it's clearly somewhat flawed as a crowdfunding campaign.

The Future's So Bright My Giant Head's Gotta Wear Shades

That said, at this point I'm totally convinced that the fate of Thefuture.fm comes down to execution and strong relationships with DJs and their fans. Barbiere feels that the DJs are key to recruiting fans and, though some social platforms faced with a two-sided market are kidding themselves when they assume the artists will inevitably draw the fans, Thefuture.fm could actually work that way. Nevertheless, direct outreach to fans is a much-needed component because two-sided markets are cruel masters.

Though I know some will be sceptical at the prospect for a subscription-based service, Barbiere pointed to the commodification of music by streaming platforms such as Spotify and Pandora. The reality is such platforms will continue to face price wars, shrinking margins and overly funded copycats that will gradually bleed most of them dry.

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Thefuture.fm's New CEO Details Fresh Revenue Streams For DJs

Recently Thefuture.fm announced that they were launching a royalty system for DJs that upload mixes to the site. Having already solved the problem of paying copyright holders for mix content, they are now offering DJs a compelling mix of revenue sources that should be much bigger news than most of the music industry and tech media seem to recognize. This week I spoke with Thefuture.fm's new CEO, Bob Barbiere, who filled me in on the specifics.